Comment 26 May 2016
SA office market anomalies
by Cees Bruggemans words 1400
In big booms & busts, regional office market nodes experience pretty much the same thing. The ups & downs tend to be universal, and big. In booms, vacancies shrink rapidly. In busts, they explode higher.
But in an economy losing all growth momentum, yet subject to many diverse cross-currents? Each region tends to show up unique responses. It makes generalisation dangerous, so much depending on location and unique kinds of forces at play.
Comment 25 May 2016
Divergent market views
World markets are at a crossroads, nowhere more than in the US, where equity, bond and Fed views continue to diverge sharply. The Fed may have capitulated briefly four months ago, coming belatedly into line with market views of a low rate trajectory, but this was always going to be temporary, given the resilient manner of the US economy’s recuperation.
Last week we saw the first definite signs this temporary Fed capitulation to market wishes has come to an end as sentiment has started to shift, and will do some more shortly in preparation for when the Fed resumes its liftoff. This time it is equity & bond markets that will have to face the music and come into line with Fed thinking & actions, with currency (Dollar, weak EMs) & commodity markets (all sorts) also required to adjust.
Comment 18 May 2016
Non-usual f/cast worry
by Cees Bruggemans words 1050
The known features globally aren't particularly terrifying. The unknowns are another kettle of fish altogether. Do we actual understand the environment we may likely be moving through shortly?
At home, there is considerable more dread about what we already know, in addition to which we are facing major conflicts whose resolution either way are going to reshape us.
Comment 17 May 2016
SA recession challenges
by Cees Bruggemans words 1670
For some it is a matter of fact that SA is in recession, or at least rapidly gliding towards one, with 1Q16 already deeply suspect, and the looming quarters (2Q16, 3Q16 & 4Q16) most at risk, after which things could still change.
Others are not so sure, seeing possibilities of being saved by the bell. What is it going to be?
Comment 16 May 2016
The world divides into two halves at present. There are normalisation stories underway, with long-term fuses, but they will probably reach their destination in the end, even if meeting with a lot of skepticism along the way.
And then there are the many demolition derbies, which potentially destroy much and don't quite look the same once the world comes up for air (in the hopefully more restful 2020s?).
Comment 11 May 2016
The world remains slow moving. The main cause is a universal CAUTION keeping things back. The main reasons for this are not difficult to fathom. Much more challenging is to see what will overcome it.
If this global mental lethargy is not overcome shortly (as seems likely), what are the consequences of a half throttle world refusing going to full throttle? Head scratching all around....
Comment 10 May 2016
Europe flying apart?
by Cees Bruggemans words 1700
These are shocking words (Is Europe flying apart?) but then the strains are getting to be such that it is a bigger legitimate question with every passing day. Will the Eurozone hold together or blow apart?
The signs & symptoms are getting more worrisome by the day. Grexit wasn't really on, but Brexit in June could be (with other regional bits waiting in the wings, all wanting to go their own way). The nationalistic urges and distrust of centrist Brussels are deepening, with every year bringing another way of reinforcing this. Since last year it has been the mushrooming migrant crisis, erecting fences, unwilling to accept refugee quotas, refusing to pay for keeping Turkey accommodative, the latter with difficulty coming into line with EU demands regarding visa-free travel. Political extremism is gaining ground. And ticking away are macro policies (fiscal austerity, rising debt burdens, ECB monetary support) that seem to be damaging the European Project from the inside.
Comment 26 April 2016
A better 2nd quarter
by Cees Bruggemans words 930
One counts one’s blessings very carefully, acknowledges to be entirely in the power of precarious outside forces & reactionary domestic forces, either of which can offer sudden surprises, and otherwise proceed very cautiously.
Whereas 4Q15 & the opening round of 1Q16 gave us a thorough thrashing, by way of searing drought, Rand and bond yield shocks, there was a distinct change in tenor from February onward.
Comment 21 April 2016
One gets confronted with a lack of growth, not for the odd quarter but years on end. Each country/region/cluster has its own reasons for this state of play, but globally it tends to be due to a lack of demand. Why? Why weak demand if there are surplus resources that would support a higher level & growth of activity?
Some are quick to trot out secular stagnation. An absence of good investment opportunities, itself a reflection of a technological hiatus or saturation of public infrastructure. Changing demographics, especially aging shrinking the skilled labour force. But often it is something as simple as fear, heightened uncertainty and the unwillingness to take on risk, affecting businesses, individuals and governments alike. That can cause a falloff in demand growth that then stabilises as a “new normal”. What would feed such uncertainty?
Comment 20 April 2016
Things to turn better?
by Cees Bruggemans words 1220
It is hardly unanimous, with many looking for more downside, but could upside be beckoning? Globally, and with a lag locally, provided our political impasse can be undone?
Instead of the rich developed West stumbling anew (effectively running out of expansion runway), and China unable to prevent further sliding, between them testing central banks and showing up their impotence, on our way to another global shock implosion, the very opposite outcome offers itself, too. The US and European labour markets continue to steadily reabsorb labour, China is structurally repositioning while supplying macro support (to prevent stall speed from taking hold), the Dollar’s advance has been checked (for now), commodities and risky EM plays responding positively.